This paper is devoted to the theory of economic development elaborated by Deirdre McCloskey. We analyze the main statements of the theory and identify its specific features that distinguish it from other similar approaches, which consider institutions and culture as reasons of economic development. We show that key differences of these approaches are based on varied comprehension of institutions and different views on humans and human motivation. It is concluded that McCloskey’s theory copes better with explanation of huge shifts in levels of per capita income, associated with the modern economic growth, while neoinstitutional approach is preferable when we try to explain differences in per capita incomes in similar countries, which have already moved to the modern economic growth stage. We outline a possible way of synthesizing the theories of McCloskey and Joel Mokyr, which focus on ethical and epistemic changes respectively.